10 Worst Performing REITs in 2024

1. Office Properties Income Trust (NASDAQ:OPI)

Year-to-Date Decline: 71.49%

Number of Hedge Fund Holders: 17

Office Properties Income Trust (NASDAQ:OPI) is a real estate investment trust focused on owning and leasing office properties to high-credit quality tenants across the United States. As of June 30, 2024, the firm owned and leased 151 properties with 20.3 million square feet situated in 30 states and Washington, D.C.

OPI boasts a strong portfolio supported by a high credit tenant base with almost 61% of revenue coming from investment-grade rated tenants, as of June 30. Additionally, the portfolio ensures geographic and industry diversification. The firm is managed by the RMR Group, an alternative asset management company focused on commercial real estate and related businesses, something OPI sees as its competitive advantage. The firm believes that RMR provides management services at costs lower than what OPI had to pay if it were self-managed other than bringing scale and efficiency to the REIT.

For the second quarter, Office Properties Income Trust (NASDAQ:OPI) reported a net income of $76.2 million and a normalized FFO of $33.2 million. In regards to leasing, OPI signed 208,000 square feet of new and renewal leases and closed the quarter with the same property portfolio occupancy of almost 90%. The REIT is under agreement to sell 12 properties for approximately $93.5 million, expected to be closed by year-end.

In conclusion, Office Properties Income Trust (NASDAQ:OPI) has a well-established and diversified portfolio, quality tenants, and support from the RMR Group. The company’s stock is held by 17 hedge funds, as of Q2 2024.

While we acknowledge the potential of OPI as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than OPI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.